Your (and your partner’s) total income is added together in order to calculate your Housing Benefit award. This includes all earned income (such as wages) and all unearned income (such as Child Tax Credit).

 

Employed earnings

We can only deduct the following from your gross earnings regardless of what is actually deducted:

• Income Tax
• National Insurance contributions
• half of any pension contributions

We try to use an average of your income. For example, if you’re paid monthly we’ll deduct the above and work out a fair average of your earnings over a period of time. We may choose to exclude higher or lower payslips if these are not representative of your usual average earnings.

We require 2 monthly payslips, 2 four-weekly payslips, 3 fortnightly payslips or 5 weekly payslips. All payslips provided must consecutively follow each other.

If you have just started work, and have not yet received the number of payslips we have asked for, you can provide:

• one payslip
• your contract of employment
• a letter from your employer confirming the number of hours you're due to work each week and your hourly pay, or the number of hours you're due to work each week and your annual salary
• a Certificate of Earned Income form which must be completed and stamped by your employer. These forms are available on request

You'll still need to provide your 2 monthly payslips, 2 four-weekly payslips, 3 fortnightly payslips or 5 weekly payslips once received.

 

Self-employed earnings

If you're self-employed we'll require your self-employed accounts. Your self-employed accounts should be for a recent trading period (for example the most recent financial year, or the last 6 or 12 months).

You will also need to supply evidence of your income and expenses by providing invoices and receipts for the relevant trading period.

We'll then work out your profit for the trading period and disregard any income tax, National Insurance contributions and half of any pension contributions. The remaining profit is then converted into a weekly figure.

If you have just started self-employment you can:

• provide a self-employed account for the last 3 months with proof of income and expenses
• provide a projected self-employed account for 3 months from the start of your self-employment

If you don't have your self-employed accounts already prepared, you can print the self-employed declaration form and complete it as fully as possible.

You should ensure your trading period on the self-employed declaration form does not exceed 52 weeks.

Self employed declaration form (PDF, 156.32 KB)

If you're self-employed you will also need to provide a letter from HMRC confirming your Unique Tax Payers Reference Number (UTR Number).

 

Benefits

If you're in receipt of other welfare benefits these will be added to your claim as they are paid and no amounts will be deducted. You'll need to provide a recent letter from the relevant benefits department to confirm your entitlement.

 

Income we don't include

Some incomes are completely disregarded for the calculation of Housing Benefit, for example Child Benefit, Disability Living Allowance and money received from an ex-partner towards child maintenance.

We disregard a small amount from your earnings if you are working. These disregards vary depending on your household composition and the number of weekly hours worked by you and/or your partner.

Student income and Housing Benefit

Student loans, grants and bursaries are treated as income for Housing Benefit purposes.

If you're entitled to a student loan (via student finance) and choose not to take the loan, then the amount you were entitled to will still be treated as your income.

Similarly if you take a lower amount than you're entitled to, we will still treat the amount you were entitled to as your income.

However the following forms of loans, grants and bursaries are disregarded for Housing Benefit purposes:

• Child Care Grant
• Parent’s Learning Allowance
• some bursaries which are for course-related costs and/or childcare
• Special Support Grant
• student grant for tuition fees
• student loan for tuition fees

We will need to see all pages of your Student Finance award letter, clearly showing the breakdown of your loans, grants and bursaries.

We will also need to see an original Council Tax exemption certificate or a student registration letter confirming your weekly hours of study and the length of your course.

Childcare costs and Housing Benefit

An amount for childcare costs can be disregarded from your earnings if any of the following apply to you:

• a lone parent in remunerative work for 16 hours per week or more
• a couple where both work at least 16 hours per week
• a couple where one works at least 16 hours per week and the other is incapacitated, in hospital or in prison

In order to deduct childcare costs from your earnings, the childminder must be one of the following:

• a registered domiciliary care worker
• foster carer (but not for their foster child)
• Ofsted registered
• someone approved under the Homecare Providers Scheme
• the local authority (either at or by a school, or by the local authority at any other suitable site)

You will need to provide evidence of your childcare costs. This could be a recent letter from your childminder or a recent agreement/contract. The proof should also show their Ofsted registration number, or proof of their status if they're not Ofsted registered, such as proof they're approved under the Homecare Providers Scheme.

We can disregard:

• up to £175 per week from your earnings where one child is of the relevant age
• up to £300 per week from your earnings if there are 2 or more children of the relevant age

Relevant age means:

• a child up until the 1st Monday in September following their 15th birthday
• a disabled child up until the 1st Monday in September following their 16th birthday

You must be in receipt of Child Benefit for the child in order for us to deduct any childcare costs for that child from your earnings.

If your earnings are lower than your childcare costs, any remaining balance can be deducted from your Working Tax Credits to reduce your income for Housing Benefit purposes.